Like him or not, Sen. Ted Stevens is an institution, and the news of his indictment is another blow to the Senate, not just because of the man but also because of the nature of the alleged crime.

Throughout his decades in Washington, the Alaska Republican has controlled billions yet now could be laid low for allegedly hiding gifts pegged more in the range of $250,000. In a single stroke, the indictment punctures all the grandeur of the Senate and offers a stark contrast to the public Stevens, a genuine activist whose trademark has always been to dream big, like the West itself.

No senator has had the same reach since the legendary Washington state Democrat Warren Magnuson, who successively chaired the Senate Commerce and Appropriations committees. Before bowing out almost 28 years ago, Magnuson famously bequeathed his great wooden desk — and a refrigerator of vodka and cigars — to Stevens. Like his mentor, Stevens has held on to those twin perches — Appropriations and Commerce — and the Republican has been unusual in his ability to use the budget process not only to control money but also to write new law.

When House Republicans were tearing down Great Society programs during the mid-1990s, Stevens created his own anti-poverty agency for Alaska natives, the Denali Commission. And it was his style to reach across the aisle, once hosting a salmon lunch for Wisconsin Rep. Dave Obey, then the ranking Democrat on the House Appropriations Committee, to try to resolve a budget impasse.

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“The reality of this is you try to achieve goals,” Stevens, then chairman of the Appropriations Committee, said in an interview in 2001 — the same period from which the charges arise. “And everything I’ve done is on the books.”

A Stevens’ confidante said the 84-year-old senator only learned of the indictment Tuesday when he was pulled out of a party meeting. “It saddens me to learn that these charges have been brought against me,” Stevens later said in a statement. “I am innocent of these charges and intend to prove that.”

But the timing is politically and personally painful for Stevens. The Alaskan is in the middle of a tough reelection campaign and is preparing for his daughter’s wedding this summer. Under Republican conference rules, he has given up his ranking position on the Senate Commerce Committee as well as the Appropriations defense subcommittee, which is poised to write the new Pentagon budget for the coming fiscal year.

“He was in a caucus, and they called him out. That’s how he found out. That’s a helluva way,” said Sen. Daniel Inouye (D-Hawaii). “I told him, as far as I’m concerned, I believe in him. He’s my friend. He’s still my friend. It’s sad.”

A Harvard-trained lawyer with a pilot’s bluster, Stevens was born poor in Indiana before drifting West and ultimately joining the Army Air Corps, where he served in Asia in World War II. But as a national figure, he has always been identified first with Alaska, just as the alleged gifts — chiefly, work on a home in Girdwood — were centered there.

The seven-count indictment doesn’t accuse Stevens of a specific quid pro quo or bribery charge. But, the indictment alleges, “it was part of the scheme” in which, in the same time period, Stevens “could and did use his official position on behalf” of his benefactor, Alaska-based oil services company VECO Corp., and its chief executive at the time, Bill Allen.

Examples listed include international VECO projects in Russia and Pakistan and requests for multiple federal grants and contracts to benefit the firm, including one from the National Science Foundation.

Not mentioned in the documents Tuesday — but still illuminating the relationship between Allen and the senator — was an earmark in the same period to use dislocated U.S. workers funds for a novel plan to train Russian citizens in oil-field service management in Alaska.

The very boldness of the idea illustrates both Stevens’ style and his two great passions: nurturing Alaska’s budding partnership with the Russian Far East and using it to benefit poor Alaskans under the Alaska Native Claims Settlement Act, adopted in his first years in the Senate.

Sakhalin Island was the target, but the notion of importing foreign workers for training — and paying for U.S. officials’ foreign travel to Russia — was a stretch. And it took some time, as well as a letter from Allen, before the Labor Department released the funds — about $2 million in June 2001.

This mix of dreams and deals was classic Stevens, but the charges now put everything in a different light. Critics will argue that the senator reached so far that he forgot how to apply the Senate’s rules to himself. And the final irony is that the charges arrived just as the House is set to finally begin floor debate Wednesday on the first of the 2009 appropriations bills.

The maiden voyage will be made by the always popular military construction and Veterans Affairs budget, but the Stevens indictment reinforces the notion that spending earmarks will again be an issue.

Punctuating this point Tuesday evening was Steve Ellis, vice president of Taxpayers for Common Sense, who wanted an even more severe penalty for Stevens.

“Stepping down from his two committee leadership positions is just convenient window dressing,” Ellis said. “Sen. Ted Stevens should be stripped of all of his committee assignments. Period. In doing so, Senate leadership will send the message that they are taking this betrayal of the public trust seriously and assuring taxpayers that spending decisions are being made for the public good, not personal profit.”